MISREADING MEXICO: How Washington Stumbled -- A special report.

Mexico and Drugs: Was U.S. Napping?

Published: July 11, 1997

(Page 7 of 7)

That no other army commander had taken remotely so much initiative in the fight against drug trafficking did not stir much doubt among experts who assessed his appointment for the two intelligence agencies and the Drug Enforcement Administration. Rather, according to several officials familiar with their reports and briefings, the intelligence analysts appeared to take their main cues from American drug-enforcement agents stationed in Guadalajara. The agents, who had dealt with the general on several cases, thought he was all business.

Some of the analysts did note that General Gutierrez Rebollo had managed to avoid the regular rotations to which other commanders were subjected. But officials said that their reports and briefings raised no particular alarm that he had remained for more than six years in Guadalajara, the Beirut of Mexico's drug underworld.

It is an established pattern of Mexican corruption that successful police commanders sell protection to one trafficking group while attacking others. But it went unnoticed among drug-intelligence analysts, officials said, that General Gutierrez Rebollo had been vigorously attacking the Tijuana-based drug gang run by the Arellano Felix brothers while virtually ignoring their rival, Mr. Carrillo Fuentes.

Had United States officials queried senior Mexican law-enforcement officials, they might have confirmed that the general had balked at turning over suspected associates of the Arellano Felix gang whom his officers had captured, tortured and held incommunicado.

Had they asked officials in Guadalajara, they would have heard about serious allegations of misconduct against a close aide whom General Gutierrez Rebollo had placed as head of the state police. After the state government dismissed the aide, the general hired him back as chief of investigations at Mexico's drug enforcement agency.

''He was showing results,'' said one American official who dealt with General Gutierrez Rebollo. ''His methods were overlooked.''

By the time of his arrest in February, American drug enforcement officials had heard from several informants who questioned the general's honesty. The reports were not vigorously pursued, officials said.

Since the Gutierrez Rebollo episode, officials said, the C.I.A. has instituted a new system to warn of such problems.

Every biography the agency's analysts produce on a Mexican official now includes a caveat: just because no negative information has turned up does not mean that the official can necessarily be trusted.

The Solutions

Structural Changes Encounter Resistance

By late 1995, the new Director of Central Intelligence, John M. Deutch, was sufficiently dissatisfied with the agency's reporting on Mexico that he ordered intelligence officers and analysts to redouble their efforts.

Mr. Deutch, who lived briefly in the Mexican city of Cuernavaca as a boy, took over the post with the Clinton Administration still feeling the sting of Congressional and public anger over the peso crisis. Officials said he included Mexico for the first time on the list of strategic priorities for the C.I.A. He asked his officers to focus on the stability of Mr. Zedillo's Government and the threats it faced from both drug corruption and guerrillas.

Nearly two years later, the White House's drug-policy chief, General McCaffrey, suggested that the problems of intelligence on Mexico are still far from solved.

Fresh from his own embarrassment with the fall of General Gutierrez Rebollo, General McCaffrey said in an interview that he has begun an effort to create ''a newly defined architecture'' for the myriad agencies that collect information to support anti-drug efforts.

General McCaffrey said the goal of the redesign will be to establish new ''roles and missions and a hierarchy'' for such agencies as the Drug-Enforcement Administration's El Paso Intelligence Center, the C.I.A.'s Counternarcotics Center in Langley, Va., the Treasury Department's Financial Crimes Enforcement Network outside Washington, and the National Drug Intelligence Center in Johnstown, Pa.

''We need to make sure that this extraordinary amount of information that we've got supports real-world people involved in drug interdiction better than it does now,'' he said.

General McCaffrey said he had briefed the Secretaries of State, Defense, Justice and Treasury on the idea, described it to the Congressional intelligence committees, and gotten the acting Director of Central Intelligence, George J. Tenet, to join him in leading a study group that is to design a new structure by this fall.

But other officials said there is already strong opposition to the idea, particularly in the Justice and Treasury Departments. Some officials in those agencies said they were concerned about protecting sensitive or confidential information, such as the details of continuing investigations or income-tax returns. Other officials said that to pool any of their information would be to cede power.

''Call me when it happens,'' one senior official said. ''Something like that might work in the military, but those guys don't fight like they do in Washington.''

Photos: MOUNTAINS OF DRUGS ARE SEIZED: A Mexican soldier carried cocaine to a pile for incineration in Matamoros in April. The cocaine was part of a shipment of about 10 tons that was found inside a tanker truck. (Reuters)(pg. A10); A KINGPIN ON TRIAL: Juan Garcia Abrego was escorted from the Federal courthouse in Houston last year after his arraignment on charges of drug trafficking and money laundering. (Associated Press); Raul Salinas de Gortari (Reuters); Gen. Jesus Gutierrez Rebollo (Reuters); Amado Carrillo Fuentes (El Norte/Associated Press)(pg. A11) Map of Mexico highlighting Guadalajara: Mexico's jailed drug-enforcment chief was commander of the military region centered on Guadalajara. (pg. A11) Chart: ''The Trail of Drug Corruption'' As Mexico's drug trade boomed, American officials received repeated warnings of high-level corruption among Mexican law-enforcement officials and politicians. Dec. 1, 1988 -- Carlos Salinas de Gortari takes office as Mexico's President and promises to attack drug trafficking with renewed zeal. January 1990 -- A Federal grand jury in Los Angeles indicts the former Mexican federal police chief and 18 others in the kidnapping, torture and murder of an American anti-drug agent, Enrique S. Camarena, in Guadalajara in 1985. Fall 1991 -- A Mexican police commander, Guillermo Gonzalez Calderoni, begins a series of confidential interviews in which he tells American officials that high-level Mexicans, including the President's elder brother, Raul Salinas, are involved in drug-related corruption. After a long debate, American officials file the allegations away without further investigation. November 1991 -- Mexican soldiers, apparently protecting a drug flight, gun down seven federal police agents who chase the traffickers with American radar assistance to a remote airstrip in the eastern state of Veracruz. Despite the evidence of military collusion with the traffickers, the United States Ambassador, John D. Negroponte, initially describes the incident ''a regrettable accident.'' April 1992 -- Mr. Salinas's Comptroller General, Mara Elena Vazquez Nava, tells the President of allegations that his elder brother, Raul, is involved in corrupt business activities. At the President's apparent insistence, Raul Salinas gives up his Government post and briefly leaves the country to take a research position at the University of California at San Diego. March 1993 -- A convicted Mexican cocaine smuggler, Magdalena Ruiz Pelayo, begins offering testimony to American prosecutors. She claims that Mr. Salinas's father, for whom she says she once worked, has ties to drug traffickers. Aug. 26, 1993 -- A top associate of one of Mexico's biggest cocaine traffickers, Juan Garcia Abrego, tells F.B.I. officials in Houston that his organization paid huge bribes to a Deputy Attorney General in charge of anti-drug efforts under Mr. Salinas, Javier Coello Trejo, and other senior Mexican law-enforcement officials. Nov. 8, 1993 -- Mexican intelligence officers intercept telephone calls that reveal a relationship between Mr. Salinas's Communications and Transportation Minister, Emilio Gamboa Patron, and a woman under investigation as an associate of Mr. Garcia Abrego. Mr. Gamboa says the woman was a friend of his but denies any association with Mr. Garcia Abrego. The woman is also found to have carried on a long affair with Mr. Salinas's chief of staff, Jose Cordoba Montoya, but is never charged with wrongdoing. Aug. 4, 1994 -- A Mexican federal police commander takes delivery of some eight tons of cocaine from a converted passenger jet that lands near the northern mining town of Sombrerete. The Deputy Attorney General in charge of anti-drug programs, Mario Ruiz Massieu, supervises an investigation that uncovers no wrongdoing. Dec. 1, 1995 -- Ernesto Zedillo takes office as President, vowing to clean up Mexico's law-enforcement apparatus. Before his inauguration, an American diplomat gives his transition team a list of 18 current and former Mexican officials viewed as corrupt by the United States Embassy. Feb. 28, 1995 -- Raul Salinas de Gortari is arrested on charges of having plotted the murder of Jose Francisco Ruiz Massieu, his former brother-in-law and the brother of the deputy attorney general. Raul Salinas is later found to have stashed more than $120 million in foreign bank accounts under a false name, with Citibank transferring much of the money. Carlos Salinas subsequently leaves Mexico and goes into exile. March 3, 1995 -- Mario Ruiz Massieu is arrested at Newark International Airport on Customs charges. In 1997, he is forced to forfeit almost $8 million he had deposited in Houston bank accounts after the money is shown to have come from drug traffickers' bribes, including a large payoff for the Sombrerete cocaine shipment. July 1996 -- Along with Magdalena Ruiz Pelayo, another convicted drug trafficker, Marco Enrique Torres, agrees to testify about drug payments made to Raul Salinas. Feb. 6, 1997 -- General Gutierrez Rebollo, Mexico's newly appointed drug enforcement chief, is arrested in Mexico City and later charged with having secretly worked for Amado Carrillo Fuentes, a powerful drug trafficker who was reported dead on July 5. (pg. A11)